Japan 01 (May 08 - Dec 09)

[HengHeng]

wah got young pretty one serve coffee boh jio ...lol

[kennynah]

i tell u where to go....

vivocity....wahahahaha...

[winston]

Financial Times: Japanese inflation at highest level in a decade

“Inflation in Japan accelerated in June to 1.9%, the fastest pace in more than a decade because of surging energy and food prices.

“Japan was until recently in deflation and so price pressures remain mild compared with most of the world. Excluding energy and food, CPI rose just 0.1% last month.

“Japan’s inflation is not caused by domestic demand, so the Bank of Japan is seen to have little scope to raise rates from the current level of 0.5%. The bank’s concern is increasingly turning towards growth.

“This month, the central bank cut its economic growth forecast from 1.5% to 1.2% for the year ending March 2009.

“The squeeze on consumers is likely to hit consumption in the second quarter. Coupled with last month’s first export decline in more than 4½ years, some economists are forecasting that second-quarter GDP growth will be negative.”

Source: Lindsay Whipp, Financial Times, July 26, 2008.

[winston]

Paul Danis (Lehman Brothers): Japanese rally has legs

“The outperformance of Japanese stocks over the past few months looks set to continue, believes Paul Danis, equity strategist at Lehman Brothers.

“‘After strongly underperforming from early 2006 to March this year, Japan has outperformed the global equity market by 14% in dollar terms and 24% in local currency terms since mid-March,’ he says. ‘We think that the rally has legs.’

“Mr Danis notes that the total cash yield in Japan has bucked the global trend and kept rising as net stock buybacks have increased, in contrast to the US and UK. ‘We view this development as supportive for two reasons. First, it reduces equity supply. Second, it is a vote of confidence from the Japanese corporate sector.’

“Mr Danis also says that while the economic backdrop in Japan is far from great, he expects growth to be strong relative to the rest of the world. ‘Some key Japanese economic indicators are showing resilience, and there are continued signs that Japan’s economy is exiting a deflationary period.’

“He adds that analysts have aggressively marked down Japanese company earnings expectations, while for the World ex-Japan composite, earnings are still at peak levels. ‘There is scope for this gap to close, which should benefit Japanese stocks relative to global markets in aggregate.

“‘We recommend investors with a global mandate overweight Japan in equity-dedicated portfolios.’”

Source: Paul Danis, Lehman Brothers (via Financial Times), July 28, 2008.

[LenaHuat]

From the FT :

Japan close to declaring recession
By David Pilling in Tokyo

Published: August 3 2008 17:47 | Last updated: August 3 2008 17:47

Japan’s government may be forced to declare that the country has entered a technical recession, according to several economists, although any downturn is likely to be far shallower than previous contractions in 2001 and 1998.

A statement from the cabinet office that the economy was “deteriorating” would in effect declare an end to what has been the longest recovery since the second world war.

[millionairemind]

Japan Machinery Orders Fall Less-Than-Expected 2.6% (Update2)

By Jason Clenfield

Aug. 7 (Bloomberg) -- Orders for Japanese machinery fell less than economists estimated in June, a sign that any recession in the world's second-largest economy may be mild.

Equipment orders, which signal capital spending in the next three to six months, declined 2.6 percent from May, when they climbed 10.4 percent, the Cabinet Office said today in Tokyo. The median estimate of 39 economists surveyed by Bloomberg News was for a 9.9 percent drop.

Japanese companies aren't as vulnerable to a slowdown in demand as they were in previous recessions because over the past decade they cut debt, closed factories, laid off workers and expanded sales in developing markets. Still, falling exports and soaring energy and material costs have squeezed profits, compelling companies to cut production, investment and hiring.

``Japan's recession will be milder than previous ones as companies are much more cautious about piling up inventories,'' said Yasuhide Yajima, a senior economist at NLI Research Institute in Tokyo. ``Capital spending is holding up, though uncertainties remain over the slowing U.S. and emerging economies.''

The yen traded at 109.42 per dollar as of 9:45 a.m. in Tokyo from 109.50 before the report was published. The Topix machinery index of shares rose 0.2 percent, compared with a 1 percent decline in the benchmark Topix.

Orders climbed 0.6 percent in the second quarter from the first three months of 2008, beating a March forecast for a 10.3 percent decline. Machinery makers predict orders will drop 3 percent in the current quarter, today's survey showed.

Still Spending

Companies plan to increase capital investment by 4.1 percent in the year ending March, according to a survey released this week by the Tokyo-based Development Bank of Japan. While that's slower than last fiscal year's 7.7 percent, it's better than the 10 percent decline recorded during the 2001 recession.

The Bank of Japan's most recent business survey showed labor demand is close to a 16-year high. The jobs-to-applicants ratio was at 0.91 in June, meaning almost every person who wants a job can get one. In 2001, there were two applicants competing for every position.

``The current technical recession is completely different from previous ones,'' said Kiichi Murashima, chief economist at Nikko Citigroup Ltd. in Tokyo. ``Business investment is holding up surprisingly well.''

Probably Shrank

Still, weakening exports and consumer spending probably caused the economy to shrink for the first time in a year last quarter. Economists estimate a report on Aug. 13 will show gross domestic product contracted at an annual 2.3 percent rate. Exports fell in June for the first time since 2003 and household spending slid for a fourth month.

The economy is ``deteriorating,'' the government said yesterday, acknowledging for the first time that the country's longest postwar expansion has probably ended.

``The economy has entered a recession triggered by an export slowdown,'' said Tetsufumi Yamakawa, chief Japan economist at Goldman Sachs Group Inc. in Tokyo. ``We expect the capital expenditure correction to continue as corporate revenue and earnings both begin declining.''

A Kyushu-based Toyota Motor Corp. subsidiary that builds sport-utility vehicles fired 800 workers since June because of falling demand for the vehicles in the U.S. Toyota says it will cut spending on research and development this year for first time since 2001.

Fukuda's Reshuffle

Prime Minister Yasuo Fukuda last week replaced his economic ministers in a bid to boost his popularity, which has plummeted amid rising food and gas prices and a 13 percent slide in the Nikkei 225 Stock Average this year.

Finance Minister Bunmei Ibuki said this week Japan is at risk of falling into stagflation, a combination of slowing growth and spiraling prices. Economic and Fiscal Policy Minister Kaoru Yosano said on Aug. 4 that he plans to announce measures this month to help consumers and companies cope with rising energy costs.

``Whether we're in a technical recession or not isn't important to investors,'' said Nikko Citigroup's Murashima. ``The more important question is how deep and how protracted. I think this will be short and shallow.''

[millionairemind]

Published August 8, 2008
Ageing Japan now considers immigration
By ISABEL REYNOLDS

JAKARTA nurse Yanti Kartina left her family in Indonesia and joined 200 other nurses moving to Japan where a rapidly growing elderly population has created a desperate need for carers in old age homes and hospitals.

Mass immigration could transform a country once so wary of foreigners that it excluded them almost entirely for more than 200 years until the 19th century.

The nurses, who are expected to learn Japanese and requalify as they work, are seen as an important test case as Japan struggles with the world's fastest growing elderly population and a workforce that is forecast to shrink, potentially devastating the economy.

'Japan is the first developed country to face this kind of population crisis,' said Hidenori Sakanaka, a former immigration bureau chief in the capital of Tokyo who now heads a think-tank.

With more than a quarter of Japanese expected to be aged over 65 by 2015, the country faces serious economic consequences, including labour shortages that could weigh on gross domestic product (GDP).

A group of ruling party politicians see immigration as a possible solution and have presented Prime Minister Yasuo Fukuda with a radical new proposal that seeks to have immigrants make up 10 per cent of the population in 50 years' time. Government figures show that the workforce is on course to shrink by eight million in the next 10 years.

If the necessary laws are passed, mass immigration could transform a country once so wary of foreigners that it excluded them almost entirely for more than 200 years until the 19th century. 'I don't think there is any way forward but to accept immigrants,' Mr Sakanaka said.

Even now, the idea of allowing in more foreigners is often described as a risk to Japan's relatively crime-free and homogeneous society. Many landlords refuse to rent apartments to foreigners and few Japanese employers offer immigrant workers the same rights as their Japanese colleagues. Less than 2 per cent of Japan's almost 128 million population are currently foreign-born.

Tetsufumi Yamakawa, chief economist at Goldman Sachs in Tokyo, believed that immigration, combined with efforts to draw more women and elderly people into the labour market, could lift growth above the annual one per cent or less forecast by many analysts. 'I think this is very good timing to start thinking about this,' he said. 'The decline is already in sight.'

The Indonesian nurses, who have been recruited to work in short- staffed hospitals and old peoples' homes, are the latest wave of controlled immigration. Government officials hope that they will face fewer problems than their predecessors.

More than 300,000 immigrant Brazilians of Japanese descent have been a boon for Japan's automotive and electronics factories, where many of them work. They have also boosted the Brazilian economy, remitting US$2.2 billion dollars home in 2005 alone, according to the Inter- American Development Bank.

But in many ways, the Brazilians have failed to fit in even though they are the descendants of Japanese who left rural areas to start afresh in Latin America, mostly in the early 20th century. Believing that their heritage would give them an advantage in blending in, the Japanese government loosened conditions for working visas for them in 1990. The move was not entirely successful. The Brazilians complained of discrimination and lack of schooling for their children, many of whom spoke only Portuguese, while their Japanese neighbours were often shocked by their late-night parties and failure to conform to rules such as trash recycling.

'They were just brought in and nothing was done to help them in terms of welfare afterwards,' said ruling Liberal Democratic Party (LDP) lawmaker Hirohiko Nakamura, a member of the committee that produced the new immigration report.

'Then people blame the foreigners for the problems, even though it's Japan that invited them here and didn't do anything for them,' he added. The worst case, he said, are the tens of thousands of mostly Chinese workers allowed in on temporary 'trainee' visas that allow them to work in menial jobs on farms and in factories.

That system has kept some small regional businesses ticking over, but reports of abuses such as extremely low pay, sexual harassment and confiscated passports abound.

Many said that despite the desperate need for workers, Japan is setting hurdles too high for the latest batch of immigrants. The Indonesian nurses and care workers will have only six months of Japanese study before starting full-time work. They must pass the relevant national examinations within three or four years while working as assistants, or be forced to return home.

Lawmaker Nakamura was optimistic about their chances, citing the example of some of the country's highest profile immigrants. 'Look at the Mongolian sumo wrestlers! They speak Japanese really well,' he said.

But former immigration bureau chief Sakanaka was worried that the Indonesian nursing programme would end in failure because of the complexity of the Japanese language and because he thought that the rules have been made too strict. 'I think the system will turn out to be an embarrassment,' he said. 'Almost nobody

[kennynah]

Japanese June Industrial Production Falls
8/12/2008 1:09 AM ET

(RTTNews) - Japan's industrial output declined by a seasonally adjusted 2.2% month-on-month in June, revised down from 2% fall initially estimated, a final report from the Ministry of Economy, Trade and Industry revealed Tuesday. Compared to prior year, the production remained flat.

Further, the Ministry said that the shipments recorded a monthly decrease of 3%, while inventory grew by a revised 1.1% in June.

The operating ratio dropped 1.7% in June from the prior month compared with the original growth estimate of 2.2%. On an unadjusted basis, the production capacity climbed 2.3% on a yearly basis and remained unchanged from the previous month.

[millionairemind]

Japan's second-quarter GDP contracts 2.4% on year
By Chris Oliver, MarketWatch

Last update: 5:58 a.m. EDT Aug. 13, 2008

HONG KONG (MarketWatch) -- Japan's economy contracted in the April-to-June quarter on an annualized basis, as softer consumer spending and weak capital investment threaten to bring the country's long post-war expansion to an end.
The economy shrank 2.4% in the second quarter, after expanding a revised 3.2% in the first, according to preliminary figures released by the Cabinet Office Wednesday.
Consumer spending, which accounts for almost half of economic activity, fell 0.5% on quarter. The figures also reflect the distortion of an extra shopping day in the previous quarter than normal years owing to the leap-year effect.

Full story
http://www.marketwatch.com/news/story/j ... dist=msr_6

[ishak]

A slowing economy in Japan
Aug 14th 2008, The Economist

The economy in Japan is battered by rising prices and slowing exports

Japan's GDP contracted in the second quarter of 2008, underlining the dampening effect that rising prices and weakening exports are having on the world's second-largest economy. The prospects for the rest of this year and 2009 are equally poor, and the Economist Intelligence Unit expects full-year growth to slow sharply from the very healthy rate of 2.1% recorded in 2007 to less than 1% in 2008.

According to data released by the government's Cabinet Office on August 13th, seasonally adjusted real GDP contracted by 0.6% quarter on quarter in the three months to June. As the new data also revise down first-quarter growth, from 1% to 0.8%, the economy's performance in the second quarter looks especially weak. In annualised terms, GDP contracted by 2.4% in the quarter to June. Japanese national-accounts data are revised frequently, so the picture may change as further data releases come out later in the year. Given the problems facing the global economy, however, it seems unlikely that any such revisions will be substantially upwards.

The latest data, at any rate, are universally bleak. This reflects the increasing impact on Japan of the various headwinds from the global economy—including weakening demand in export markets, high oil and food prices, and the continuing fallout from the US sub-prime crisis. During the second quarter of 2008, almost every expenditure component of domestic demand contracted, the exception being government consumption, which rose by 0.1% quarter on quarter. Government consumption accounts for a substantial share of GDP, at around 18%. However, it is far less important than private consumption, which accounts for 57% of GDP and which contracted by a worrying 0.5% in the second quarter.

A variety of factors are dampening private consumption, including a weakening jobs market, sluggish wage growth, rising inflation and, more broadly, concerns about the domestic political situation. For instance, in June the ratio of active job openings to applicants fell to 0.91, meaning that there are now more applicants than there are jobs available, from 1.05 a year earlier. Even those who have jobs are finding that their wages do not stretch so far, encouraging them to be more cautious in their spending. Nominal wages at companies with 30 or more employees fell by 0.6% year on year in June, while headline consumer price inflation in the same month reached a ten-year high of 2%. The irony of the pick-up in inflation in Japan is that for much of the economy's "lost decade" in the 1990s and early 2000s the country was wracked by deflation. The trouble now is that, by wide consensus, Japan is experiencing the "wrong" kind of inflation: that is, in the shape of commodity-driven cost-push inflation that discourages consumption, rather than demand-pull inflation that would reflect a pick-up in consumers' willingness to spend.

Nor is the corporate sector looking much brighter. "Private non-residential investment", which is essentially the Cabinet Office's term for capital spending by companies, contracted by 0.2% quarter on quarter in the three months to June. The latest GDP data also revise down first-quarter investment to a 0.1% contraction, compared with a small gain of 0.2% previously. Capital investment by the corporate sector has played a key role in the Japanese economy's revival since 2003, underlining among other things the success of corporate restructuring in recent years. However, companies now clearly face tougher times. The Bank of Japan's latest quarterly Tankan survey, published on July 1st, showed business confidence among major manufacturers at its worst level since September 2003.

In part, the fact that companies are more pessimistic about their prospects reflects the above-mentioned weakness of domestic demand. The problem is being aggravated by rising prices for energy and inputs—in July the corporate-goods price index rose by 7.1% year on year, its highest rate of increase in 32 years. Firms remain largely unable to pass rising costs on to their customers, so margins are increasingly being squeezed.

At the same time, the outlook for corporate profits is clouded by the prospects for the export sector. The value of exports to the US, Japan's largest overseas market, fell for the tenth consecutive month in June. Total exports fell by 1.7% year on year, the first decline in almost five years. Even growth in shipments to China—which recently has helped to offset the weakness in US demand for Japanese goods—has slowed. These trends in export values are reflected in the Cabinet Office's latest national-accounts data, which are price-adjusted and therefore show export volumes. Exports of goods and services contracted by 2.3% in the second quarter, and first-quarter growth was also revised down to 3.4% (from 4% previously). The contribution to growth from net exports of goods and services—essentially exports minus imports—was zero in the second quarter. Net exports have been one of the key contributors to growth in the past few years, so the latest decline is a worrying development. One of many in a poor second-quarter GDP performance, in fact.